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March 9, 2011

Thailand to cooperate with neighbours on rice trade

[THE NATION]

To achieve its goal of making Thailand a rice-trading centre, the
Commerce Ministry has drawn up a plan to cooperate with Burma and
Cambodia, as both countries have high competency as supply sources to
Thailand.

Meanwhile, the Thai government will directly purchase 2
million tonnes of paddy rice from farmers on March 16 as part of its
strategy to shore up rice prices.

A senior source from the
ministry said Thailand would tighten cooperation on rice trading with
Burma and Cambodia by help them export rice overseas. However, the
country will not import their rice to the Kingdom, but will set up
polishing plants in border provinces, as Thailand has high expertise in
rice polishing.

"Many Vietnamese and other foreign rice traders
have tried to purchase rice from Burma and Cambodia, as it is
good-quality but low-priced. Thailand will help both nations develop
their rice polishing and exports to emphasise Thailand as a centre of
rice trading," said the source.

The Cambodian government has
called for Thailand's cooperation to halt decreases in its rice price
after traders from Vietnam purchased rice from that country at very low
prices. Cooperation with Thailand should increase the bargaining power
for Cambodian farmers and traders, the source said.

Chookiat
Ophaswongse, honourable president of the Thai Rice Exporters
Association, has supported the government's plan to tighten cooperation
with Burma and Cambodia. However, the government must ensure that it
will prevent Thai rice seeds getting mixed up with other seeds, as that
would destroy the reputation of Thai rice as having the best quality.

In
addition, he said the government should concentrate on development of
the quality of Thai rice and on reducing production costs rather than
increasing its price guarantee.

Chookiat said the rice price had
dropped slightly because of increased supply from Vietnam. Thai rice
farmers will only enjoy a short-term benefit from increasing the
guaranteed price of rice. The government should seek ways to help
farmers reduce their costs of production and increase yield per rai in
the long run.

The association reported the export price for
5-per-cent Thai white rice had dropped slightly from US$520-$530 a tonne
last week to $510 (Bt15,490) a tonne this week.